Property expert Kate Faulkner has written this guest blog on the unsatisfactory state of today’s housing market. Like Shelter, Kate believes that it is time for politicians of all stripes to take bold action to deliver the new homes our country desperately needs, and to effectively regulate a private rented sector that is now home to 9 million people.
To solve the housing battle, we need the same determination our Veterans had
With the recent D-Day celebrations, I’m reminded of how much can be achieved with a clear plan which is implemented by trained and motivated people who work together to deliver what must have seemed an impossible task.
To me, the reason our housing market is failing and will continue to do so is because we don’t have a clear plan. Although people in some sectors of the residential market are well trained and motivated, neither politicians, local authorities and the property industry work closely enough for the one battle we must win over the next few years: to build more homes, quickly.
The housing market is not a problem for everyone. For those that are cash/equity rich and have good salaries which increase year after year, the housing market works just fine- as long as you do your research, take quality advice and work with good companies.
Unfortunately for most of those that are socially vulnerable and low paid, who aren’t settled in a council house or housing association property, the housing market is awful.
There are many reasons for this, but to me there are two big drivers. Firstly, 25 years ago it was decided to transfer people from social housing into the private rental sector. Changes were made to encourage lenders to lend and an enormous buy to let market grew. The ‘plan’ worked and now renting privately is the second most ‘popular’ way to put a roof over our heads.
For those who are disadvantaged and placed in this sector, there are some amazing agents and landlords who always put their tenant’s first. But, because successive governments have refused to regulate this sector, this means these good guys who abide by all the rules and regulations and let properties legally are letting primarily to professionals that can afford this quality service.
Unfortunately this means many of the socially vulnerable and low paid have been left with no choice. Renting from rogues or those that don’t know they need to abide by the rules and regulations or those that don’t care. As a result they are left renting substandard properties.
And because of the refusal to regulate, politicians are under constant pressure for ‘mini fixes’ which constantly fail. Worse still, some of these ways of ‘fixing’ the market are now ridiculous and many unworkable, even for the good guys. And that’s because many of the people proposing don’t understand the whole market, just a bit of it. Rents can range from a few hundred pounds a month to tens of thousands. You can’t apply ‘one rule’ for one bit and necessarily expect it to work for the others.
With the shortage of stock that exists in the private rented sector, the good agents are losing business to the bad ones because they don’t ‘make’ the landlord let the property legally. The good landlords are renting to tenants either short or long term – whichever they wish – and end up making less money because they implement all the rules and regulations, refusing to fleece the system. Then they are regularly vilified for making any money at all, despite the fact they offer a much needed, quality service.
In the meantime, it’s just the front line agents and landlords that are focused on. No-one mentions the finance sector’s responsibility to PRS. No-one says “well shouldn’t we make sure lenders only lend money to buy to let landlords who use the self-regulated agents (ARLA, NALS or RICs) or who can prove they know how to let a property legally.”
No-one praises the good landlords and agents in the media about the great job they do, so as a tenant, they go for the ‘cheapest’ because they don’t know the ‘quality’ agents and landlords are worth the extra money.
And how on earth is an unregulated private rental sector supposed to house 4 million people in quality housing who are currently on council waiting lists? No-one seems to be taking any responsibility for tackling and reducing these numbers, apart from the recent new rules on eligibility which some councils have introduced. But while we are chastising landlords and agents, not enough people are chastising councils and MPs for not building enough homes for the three housing sectors which exist: social, affordable and private. Over the last 25 years, we have had in excess of 20 housing ministers. Not one has been chastised for not delivering the homes the country and their community needs.
We can’t move forward in housing without accepting the need for social, affordable housing and private sector homes. At the moment the concentration is merely on the latter and this must be switched to the markets that need the most help.
It’s time to understand, in the run up the election, that tweaking policies have failed for over 20 years. We need proper, well-thought-through regulation that will work for landlords, tenants and letting agents, not just increase costs for those that comply. Until we get the nation behind campaigns to build more homes, work with councils and communities to work out what’s needed, where, at what price, the socially vulnerable and low paid workers will continue to be disadvantaged while owning a home will mostly be restricted to those who already do – or who have family to help them.